The Department for Transport Incentive Fund

In December 2014, the Secretary of State for Transport announced that £6 billion will be made available between 2015/16 and 2020/21 for local highways maintenance capital funding. In November 2015 a further £250 million was announced for a dedicated Pothole Action Fund.

From this funding, £578 million has been set aside for an Incentive Fund scheme, to reward councils who demonstrate they're delivering value for money in carrying out cost effective improvements.

Each local highway authority in England (excluding London) is invited to complete an annual self-assessment questionnaire, in order to establish their share of the Incentive fund they will be eligible for between 2015/16 and 2020/21.

The Department for Transport has made it clear that local authorities aren't competing with each other for funding, but are demonstrating that efficiency measures are being pursued in order to receive their full share of the funding.

The incentive funding awarded to each local highway authority will be based on their score in this questionnaire, and will be relative to the amount currently received through the needs-based funding formula.

In 2016/17, only authorities in Bands 2 and 3 will receive their full share of the £578 million, whilst authorities in Band 1 will receive 90% of their share. These percentages for Bands 1 and 2 decrease in each subsequent year, with only authorities in Band 3 being awarded their full share of the funding.

The questions are designed to enable authorities to assess their progress on the journey to the implementation of good practice, which will create an environment for effective and efficient delivery and enable capital funding to maximise its return. Underpinning this are the needs of stakeholders and the communication of the importance of the highway service and the needs for well-maintained highways.

Each authority needs to complete each of the 22 questions. These questions are divided into the following sections:

Asset management

Questions are based on the recommendations of the UKRLG / HMEP Highway Infrastructure Asset Management Guidance, published in 2013. Authorities should note that, in general, the implementation of these recommendations is the starting point for the implementation of asset management. Authorities will need to demonstrate that they have implemented these recommendations and be able to show that improvements have been made as a consequence. To reach the higher band they'll need to have implemented the asset management practices recommended in the guidance for some time and be able to demonstrate the outcomes they set out to achieve, as well as progress in achieving these outcomes.

Resilience

Resilience is a key component of asset management. Questions are based on reviews of the actions taken in the guidance produced as a result of the impact on the highway network of a succession of severe events. These include the HMEP Highway Drainage Asset Management Guidance, the HMEP Potholes Review and the DfT-commissioned Review on Transport Resilience.

Customer

Authorities can undertake a comprehensive approach to asset management and service delivery, but without having customer input they may not be delivering the right outcomes. Questions refer to good practice in consulting and informing customers and stakeholders, and recognising the importance of customer interaction with particular attention to customer satisfaction, feedback and information.

Benchmarking and efficiency

Identifying, promoting and sharing good practice can be measured by undertaking benchmarking. As this overall process is predicated on the basis of doing more for less, highway authorities are required to effectively demonstrate the efficiency savings they are achieving.

Operational delivery

Having effective operational service delivery mechanisms is another essential element of providing a cost-effective highway maintenance service. Authorities will be required to demonstrate the benefits of regular service and targeted LEAN reviews, of working in collaboration either through the supply chain or with adjoining authorities and of adopting good practice in procuring external highway maintenance services.